Instead of buying, Gen Xers are staying in the rental market longer. "The normal cycle of renting and moving onto homeownership and making room for younger renters to follow isn't happening as quickly," said McCue.

And they might not become homebuyers any time soon. More demand in the rental market has led to higher rents, which makes it harder to save for a down payment.

Stagnant wages also make owning a home a financial hardship: For households aged 35-44, incomes are at mid-1980s levels, the report found. The situation is more grim for those aged 45-54, whose incomes are the lowest since the end of the 1960s.

Memories from the housing crisis can make potential buyers hesitant to commit to homeownership.

But we could see more Gen Xers become homeowners soon with the return of those who lost their homes during the crisis.

About 11 million people were foreclosed on during and in the wake of the housing crash, according to Lawrence Yun, chief economist at the National Association of Realtors. Only about 2 million have returned to the market since.

"The remaining percent, we will see a steady conversion from renting into ownership," he said. "It won't be sudden, it will take some time."

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